Donors Capital Fund

Donors Capital Fund (DCF), formed in 1999, is a 509(a)(3) supporting organization associated with DonorsTrust (DT). Both DCF and DT were, in the funds' words, "formed to safeguard the charitable intent of donors who are dedicated to the ideals of limited government, personal responsibility, and free enterprise."[1] Along with its parent organization DT, DCF is a spin-off of the Philanthropy Roundtable, a coordinating body for conservative foundations founded by Whitney L. Ball, who passed away in 2015. The current president and CEO of DCF and DT is Lawson R. Bader, former president of the Competitive Enterprise Institute. Both funding organizations are called "donor-advised funds," which means that the funds create separate accounts for individual donors, and the donors then recommend disbursements from the accounts to different non-profits. They cloak the identity of the original mystery donors because the funds are then distributed in the name of DT or DCF, contributing another step to what has been called a "murky money maze."[2]

As a rule, Donors Trust refers clients to Donors Capital Fund if they expect to open donor-advised funds of more than $1,000,000.[3]

The twin Donors organizations are advertised as a way for very wealthy people and corporations to remain hidden when "funding sensitive or controversial issues," creating a lack of accountability[4]Please see DonorsTrust for more.

What Donors Capital Funds, and How Much

DT and DCF made grants of over $148 million in 2011 and 2012, and according to a report by DeSmog Blog the two funds granted almost $311 million between 2002 and 2010.[5] The Koch brothers and other ultra-wealthy industrial ideologues appear to be cloaking an untold amount of their donations to conservative political outlets through DT and DCF. The obscure Knowledge and Progress Fund, controlled by Charles G. Koch, with Richard Fink as president, has given only to Donors since 2005, according to Mashey.[5][6]

Coincidentally, the related Philanthropy Roundtable chose to honor Charles G. Koch with its 2011 William E. Simon Prize for "Philanthropic Leadership," enabling him to choose a non-profit to receive a $250,000 grant. The Roundtable explained that Koch is at the "forefront of strategic investment in ideas, think tanks, and academic research. . . . Having benefited from the capitalist system, he wants others to prosper in the same way."[7]

Funding Climate Change Denial

According to Robert Brulle, a Drexel University sociologist featured on PBS Frontline in October 2012, "by 2009, about one-quarter of the funding of the climate countermovement [of climate change denial] is from the Donors Trust [and] Donors Capital Fund." He added that "what you see is that as the contribution of Donors [to climate change denial groups] has increased over the 2003-to-2010 timeframe, the contribution of other foundations has declined. Koch went from a high of 9 percent of the funding flow in 2008 to 1 percent in 2010. We do know that the Koch brothers have made significant contributions to Donors Trust through their foundation called the Knowledge and Progress Fund. They gave $1.25 million in 2007, $1.25 million in 2008, and then $2 million in 2010 to Donors. We don’t know where it went after it goes to Donors, because it’s not necessarily a one-for-one giving."[8]

DonorsTrust promises to only funnel money to groups with an extreme anti-environmental bent, so industrial billionaires need not worry about their money winding up at Greenpeace, for example,[6] as DonorsTrust co-founder Whitney Ball explains:

"...if a donor names his child a successor advisor, and she wants to give to Greenpeace, we're not going to be able to do that."[9]

In February 2013, the Guardian reported that nearly US$120 million dollars from "conservative billionaires" were routed through two trusts, DonorsTrust and the Donors Capital Fund, who used a "secretive funding route" to channel the funds "to more than 100 groups casting doubt about the science behind climate change." The trusts were "operating out of a generic town house in the northern Virginia suburbs of Washington DC," and the funds "doled out between 2002 and 2010, helped build a vast network of thinktanks and activist groups working to a single purpose: to redefine climate change from neutral scientific fact to a highly polarising 'wedge issue' for hardcore conservatives."[10]

The Center for Public Integrity (CPI) published a chart of the foundations and funds that gave money to DonorsTrust, and the organizations to which Donors Trust distributed the funds. In one example, DonorsTrust was a large supporter of the Franklin Center for Government and Public Integrity, a think tank with a network of online media outlets in state capitals that covered climate change from a conservative point of view. According to IRS records, 95 percent of Franklin’s revenue in 2011 came from Donors Trust. The funding allowed Franklin to maintain tax-exemption as a “publicly supported” entity.

Funding State Think Tanks' ALEC Membership

In the mid-2000s, SPN began to secure funding for more of its member think tanks to join ALEC in order to help develop model legislation.[11] In 2011, some of this "secured funding" for SPN members' participation in ALEC came from DCF. According to DCF's 2011 IRS disclosure, it funded Michigan's Mackinac Center, North Carolina's John Locke Foundation, the Texas Public Policy Foundation, Pennsylvania's Commonwealth Foundation, and six other member think tanks "for participation at American Legislative Exchange Council meeting," providing a total of $200,000 to the groups for that purpose.[12][13]

Funding Islamophobia in the United States

Research from the Center for American Progress (CAP) indicates that DCF has funded various organizations and individuals contributing to an anti-Islamic hysteria in the United States. Between 2007 and 2009 the Donors Capital Fund contributed $21,318,600 to "groups promoting Islamophobia, some of which included the Middle East Forum, Clarion Fund, Investigative Project on Terrorism, and the David Horowitz Freedom Center. In 2008, Donors Capital contributions amounted to 96% of Clarion Fund's financial resources, which allowed the organization to distribute a controversial video called "Obsession: Radical Islam's War Against the West," which attempted to persuade Americans of the supposed Islamist threat during the 2008 election cycle. [14]